McKee out at WingHaven Country Club

Paul McKee Jr., the developer of WingHaven, the $750 million, 1,200-acre master-planned community in O’Fallon, Mo., can’t play golf there anymore.

McKee is no longer a member of the WingHaven Country Club, the 215-acre golf course that he helped develop, after he parted ways with the ownership group earlier this year.

About the same time, McKee stepped down from his role as managing partner of Spa WingHaven, the development’s 13,000-square-foot full-service day and medical spa.

McKee’s departure from the WingHaven Country Club’s ownership group and his decision to step down as the managing partner of the spa’s ownership group remain points of contention among McKee’s former partners, including John Eilermann Jr., chairman and CEO of McBride & Son Homes Inc., and Tom Dunne, chairman and CEO of construction firm Fred Weber Inc.

WingHaven Country Club was originally a partnership between McEagle O’Fallon LC, led by McKee, chair of O’Fallon, Mo.-based McEagle Properties, Eilermann, Dunne and Doug Brown, a private investor. Dunne and Brown exited the partnership about a year and a half ago.

In May of this year, McKee notified WingHaven that he would no longer contribute cash to the country club’s operations, according to Eilermann. McBride & Son WingHaven, one of the companies in the McBride & Son Homes Inc. family of businesses, became the sole member of McWing Golf LLC, the club’s ownership entity, after McKee elected to walk away from his ownership position, Eilermann said.

“Early in 2010, McKee’s group failed to fund operating expenses and, in May, notified us they weren’t going to fund their obligations,” he said. “In August, we executed a redemption agreement that finalized their departure.”

McKee disputes the terms of his departure. “Walked away is incorrect. We each had obligations with the bank that we settled,” McKee said. “I came to a settlement with the bank on my particular piece of guarantee, so we parted amicably.”

On Nov. 19, Don Davis, the former president of Centrue Bank in St. Louis, and five other partners, all of them avid golfers, acquired WingHaven Country Club for $3.7 million.

In addition to Davis, the new ownership group, Dardenne Creek Partners LLC, includes Dr. Richard Lehman, a St. Louis orthopedic surgeon, and minority owners Harry Freeman, who had been an owner of collapsed Mayer Homes and is now CEO of Freeman Homes, Michael Hopson, Michael Bernal, and Matt McGraner.

Around the same time that McKee exited WingHaven Country Club, he relinquished his role as managing partner of Spa WingHaven, according to Dunne, who took over as the spa’s managing partner. In addition to Dunne, hospitality industry veteran Bob O’Loughlin, chairman and chief executive of Lodging Hospitality Management, and two other private investors are also partners at Spa WingHaven.

Dunne said McKee remains a non-paying partner while the other partners continue to make cash contributions.

McKee said he exited the country club ownership group and stepped down as managing partner of the spa because they were “struggling.”

“In both cases they are things that I did not want to continue doing,” he said. McKee said he was still meeting his obligations on personal guarantees for loans to Spa WingHaven from Reliance Bank.

At WingHaven Country Club, Eilermann said the club was up to date on all payments prior to its sale to Davis’ Dardenne Creek Partners. Davis said Dardenne Creek would invest an additional $2.5 million into WingHaven, improving the Jack Nicklaus-designed course and sand traps, upgrading the clubhouse and expanding the restaurant space. A majority of that money will come from McBride, which will make capital contributions to the new ownership group in the amount of about $1.8 million in order to satisfy prior and future financial obligations. McBride has already invested $747,000 into the club per those obligations.

“We are in the business of building quality homes, and it’s important for us to focus on our core business,” said Eilermann. “The club will be in excellent hands with Don and his group.”

Davis said the improvements to the course and club should help boost membership, which currently stands at about 300 members.

As for the spa, Dunne said he and the other members were committed to keeping the spa open and were current on all payments to Reliance Bank, the lender on the project. “We are a solvent business, and we’re going into our busiest time of the year,” he said.

McKee, meanwhile, has hit setbacks with other local development projects.

McKee is involved in a lawsuit filed in April by BancorpSouth Bank of Tupelo, Miss., over a $36 million loan the bank made to McKee’s Hazelwood Logistics Center, a 151-acre industrial park near Lambert-St. Louis International Airport. BancorpSouth filed the suit against Hazelwood Logistics Center LLC, Hazelwood Commerce Redevelopment Corp., Paul McKee Jr. and McKee’s revocable trust in U.S. District Court for the Eastern District of Missouri. The suit seeks the balance of the loan, $28.4 million, which came due Oct. 30, 2009, according to court documents.

“We’re in settlement discussions with the bank,” McKee said. “I intend to honor all of my obligations.”

McKee also is fighting to keep a $390 million public financing package awarded by the city of St. Louis for his $8.1 billion Northside development project. In July, St. Louis Circuit Judge Robert Dierker Jr. sided with north St. Louis residents who alleged in a suit that the area and their homes were improperly designated as blighted to make way for the project’s requested tax breaks. McKee filed an appeal earlier this month to keep the package in place after Dierker rejected McKee’s request for a retrial in October.